Chinese IPOs have proved unappetising this year

Fund managers regard company flotations the way the rest of us think of online food delivery. A healthy appetite combined with a quick calorific boost is meant to bring short-term satisfaction. Alas, some Chinese initial public offerings have proved unappetising this year. One flop is Meituan Dianping, a food delivery and hotel services group backed by online giant Tencent. Its share price has significantly dropped below its IPO price. That performance is not unusual for a float on China’s volatile and promoter-friendly markets. Meituan is achieving high levels of growth — in losses… The shares tumbled yesterday. They have dropped more than a fifth since floating on the market at HK$69 ($8.80) in late September… Chinese IPOs have not been the best thing on the menu for fund managers. The largest have not all done as badly as Meituan… For every Meituan… there are others that have left a good taste in the mouths of investors… Increasingly gaunt Asian equity fund managers will not have found easy pickings in the IPO market this year. The fact that some floats hold up better than others will embolden stock pickers. Investors less confident in their selections will only nibble at new listings in the months ahead.